Unlocking potential for the economy

Updated: 2016-09-02 08:37

By Olivia F. Kirtley and Feng Shuping(China Daily Europe)

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This century has seen extraordinary developments in China's long history as a great trading nation. In 2001, China was admitted to the World Trade Organization, and in 2015, the renminbi was admitted to the International Monetary Fund's basket of reserve currencies.

China's economic ascendancy has coincided with deeper engagement and interdependence with its trading partners. This year, China will for the first time host a G20 Leaders Summit.

Chairing the world's top forum for economic cooperation is an exciting moment for the nation. In remarks delivered at the 2015 summit in Antalya, Turkey, that were warmly supported by professional accountants, President Xi Jinping called for the world to shoulder a collective responsibility to promote growth.

Bound by a strong code of ethics and a duty to the public interest, our profession occupies a unique, strategic role supporting global trade and commerce. In a study by the International Federation of Accountants this year, the profession was estimated to contribute more than $500 billion in added value to the global economy.

The federation represents the views of almost 3 million accountants through its member organizations, including the Chinese Institute of Certified Public Accountants, which has more than 220,000 members nationwide. Our shared interest in strong financial management, transparency, accountability and enhanced governance is based on the belief that these components are essential for sustainable, long-term, economic growth and better outcomes for the world's citizens.

On the global profession's behalf, the federation has for many years urged the G20 to actively promote enhanced public sector financial management, better organizational governance, and global regulatory consistency - in particular the adoption and implementation of high-quality international standards.

Understanding the regulatory environment in which businesses operate, trade occurs, and jobs and economies grow, is key to unlocking long-term economic growth. Our starting point is that regulation is a vital feature of successful economies, and as the global financial crisis showed, there were glaring problems in many jurisdictions. Governments, regulators and citizens were right to demand rapid, corrective action.

With the benefit of hindsight and mutual respect, global leaders, policymakers and businesses have a golden opportunity to pave the way for growth, and to help predict and prevent the next crisis.

Required by clients in businesses big and small to help interpret the new, post-crisis regulatory environment, professional accountants strongly support greater global regulatory cooperation. As regulation has surged and complexity increased, the risks of fragmentation have grown. We have consistently urged a focus on the principles of "good regulation" - starting out with clear objectives, deep and wide consultation, and ending in active oversight and systematic review to ensure the regulation is acting as intended.

Centuries after mastering the manufacture of exquisite silk and pottery, and being crucial to the development of world's most strategically important overland trading route, we applaud China's G20 ambitions for long-term global economic growth. Good regulation that pays heed to international commerce and trade will strongly support both innovation and shared development.

Meanwhile, professional accountants everywhere will continue to shoulder our responsibility to support a more open, transparent world economy, in the public interest.

Olivia F. Kirtley is president of the International Federation of Accountants. Feng Shuping is president of the Chinese Institute of Certified Public Accountants. The views do not necessarily reflect those of China Daily.

(China Daily European Weekly 09/02/2016 page9)